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The dollar hit a 10-week high on Friday as investors waited to see if economic growth figures in the US would do anything to halt its months of strength.
Donald Trump has expressed his dissatisfaction with the strength of the dollar, defying a custom that US presidents avoid openly interfering in financial markets.
Traders expect a potentially strong reading of US gross domestic product data on Friday, which could see the dollar appreciate more.
"The robust US GDP of today will illustrate in the market the deep division that exists between the United States and the Eurozone in terms of growth," said Thu Lan Nguyen, an analyst at Commerzbank.
Speculation about a more aggressive rise in US interest rates than expected next year would see the dollar firming against the euro, she added.
However, if the reading is below expectations, investors may be worried about the momentum of economic growth that is accelerating a shift in monetary tightening by the Federal Reserve.
"This figure could be a sign if we are achieving record results for US companies, and data on housing and consumer durables has been weak in recent years," said Sim Moh Siong, foreign exchange strategist. the Bank of Singapore.
The US economy is expected to have grown at an annualized rate of 3.3% in the third quarter, after 4.2% in the second quarter. The Fed should raise its rates by 25 basis points in December.
The euro was trading slightly higher at $ 1.13383 on Friday. The previous session had reached its lowest level in two months, at $ 1.1333, following the failure of European Central Bank Board President Mario Draghi to convince the ECB to continue the monetary tightening after the Next summer, as political and economic uncertainties grew in the monetary union.
The political orientations have been consistent since June, even though the economic outlook has darkened as the political turmoil surrounding Italy threatens the currency bloc.
According to analysts, markets remain skeptical about ECB rates, with inflation remaining low.
Elsewhere, a rebound in US stocks on Thursday after the strong sell-off of the previous session was not maintained during the Asian day, which supported safe haven currencies.
The US dollar lost 0.2% to 112.14 against the Japanese yen, a safe haven currency, while the Australian dollar, often seen as an indicator of risk appetite, hit a record low in almost 33 months.
The dollar index has stabilized at 96.56 on Friday after reaching its highest level in two months on Thursday. The gains of the dollar index are largely due to the losses of the euro, which has a weighting of 57.6%.
The dollar has recently been supported by a positive sentiment on Wall Street, while top companies such as Microsoft have generated strong earnings.
Analysts see many persistent risks to the markets, including trade tensions, Italy's fiscal woes, geopolitical uncertainties and worries over the earnings of US companies.
"There is a slowdown right now, that is the question, and the combination of all these factors is driving morale down," said Miraji Othman, Credit Strategist at BayernLB.
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